It's obvious to me that your sister doesn't really care much for her children if she's leaving them with a "party girl." I have a feeling that this "party girl" will be doing a little more than watching her kids!
If I were you, I would NOT bend to her wishes any more. If she needs your help, do what you said, and refer her to your replacement. Don't weaken and help her -- she OBVIOUSLY does NOT appreciate you!! I'm sure she's going to wish she hadn't "fired" you, but that's too darn bad!
I'd just stay away from her, and tell her to go fly a kite. LOL God bless you -- you've been a good brother. Hugs, Lee